Your down payment is not your closing cost and your closing cost is not your down payment. These are two separate things, and both should be taken seriously.
When a buyer enters into contract the buyer attempts to show good faith by sending along with the contract a down payment. This is the earnest money, which is the money put into escrow with your attorney. The down payment will be deducted from the purchase price. Depending on the type of loan you have whether FHA or Conventional if you pay less than 20% down you may be required to pay private mortgage insurance (PMI).
The closing cost is the amount paid at the closing, it includes the fees, taxes, and administrative expenses required to process the purchase of your home. FHA loans and down payments allow most closing costs to be included in the loan which can be tremendously helpful is you don’t have access to cash.
As you consider your home purchase consult Woodson Law!
コメント